Rewiring insurance
Technology has revolutionised the world we live in. Even the everyday cellphone, seemingly, has more computing power than the mainframes that launched the moon mission. The availability of a highpowered portable device has made our lives faster, and hopefully, better. This revolution has also influenced insurance consumers. They are demanding a greater degree of personalisation and instant gratification from their insurance providers.
The insurance industry is fast-growing and hyper-competitive, but with little differentiation in product offerings to consumers. The main disruptions to the traditional insurance model come from how insurance companies leverage emerging technologies such as artificial intelligence (AI) and machine learning, Internet of Things (IOT), telematics and telemetry, big data and data analytics, robo advisors, and distributed ledger technology. These technologies help serve customers better, giving them a seamless experience.
Most insurance providers have a mobile app, providing customers with easier access to their insurer. Since insurance policies remain technical, many insurance providers have chatbots or “voicebots” that help resolve consumer queries immediately. Some offer consumers a two-way video-chat facility at the time of claims to show the extent of damage to an asset which helps insurers service claims faster.
With the advent of digital wallets, sachet-based financial products are becoming increasingly important.
These are primarily targeted towards the mass market with a specific focus on insurance benefit products. To distribute such small-sized products on digital platforms, insurance providers have had to move away from their traditional core-systems towards more flexible and cloud-based applications with auto-scaling capabilities. In the past, adding or reducing capacity on large core systems was an issue. However, the advent of cloud platform has made upscaling far easier.
Agents and intermediaries are among the main distributors of insurance products to consumers. Most of them have now equipped their intermediaries with mobile and web-based applications to help ease the onboarding and servicing process. Some applications also help in agent recruitment, licensing and on-boarding of agents and intermediaries.
They have also integrated their systems with that of their intermediaries to facilitate real-time policy issuance.
New technologies such as IOT have enabled insurance providers to track marine cargo shipments for corporate customers, prevented multiple hijacking events and helped a pharmaceutical company protect its temperature-sensitive consignment in the event of an accident. IOT has also enabled instant health check-up facilities for customers. Similarly, telematics solutions in passenger vehicles identify and segment consumers based on their driving behaviour. IOT also helps monitor critical fire-fighting equipment in manufacturing units to prevent malfunctioning in an emergency.
Similarly, insurers are using AI to help speed up underwriting and smoothen the claims process. Facial mapping technology powered by deep learning authenticates customers with their valid KYC documents and has helped prevent fraudulent transactions. And sophisticated deep learning computer vision algorithms are now helping insurers assess damages on vehicles and shorten the claims and renewal process for customers.
Insurers have access to significant data and are looking for ways to unlock value from it. Similarly, new technologies lead to new types of data (images, speech, and documents). They continue to adapt to store these new varieties of data and look at harnessing newer technologies to reinvent the future. As Satya Nadella rightly said, “Longevity in this business is about being able to reinvent yourself or invent the future.”
Most of the insurance providers have mobile apps, meant to provide customers easier access to the insurer